Australian Small Business and Family Enterprise Ombudsman Bruce Billson interview with Leon Delaney.
Radio 2CC Canberra
Subjects: Energising enterprise, celebrating small and family businesses, right-sized regulation, seafood industry labelling, procurement.
Leon Delaney
The Australian Small Business and Family Enterprise Ombudsman, Bruce Billson, has written an article published by the Canberra Times over the weekend, saying it’s time to celebrate Australia’s forgotten small business. Bruce, thanks for joining us. I know you haven’t forgotten.
Bruce Billson
Leon, I hope not and I hope your listeners haven’t either. And whilst you’ve got 10 days of sunny capital days ahead of us, not all the days are sunny for our hard-working small and family businesses and I was just keen to make sure that the plight of our small and family businesses is front of mind and bright on the radar screen. And that was the purpose behind that piece in the Canberra Times today.
Leon Delaney
Now what you’ve got here is obviously a delightful turn of phrase where you say that we must ensure small and family businesses can fire on all cylinders, a reference to the commonly asserted idea that small business is the engine room of the economy.
So, you’ve managed to extend that metaphor quite nicely there, but I got particularly inspired by the bit a little bit further down, you say, ‘Everyone asks what can we do to make things easier?’ And you’ve responded to that. ‘Well, we could stop making things harder.’ I mean, it’s obvious, isn’t it?
Bruce Billson
Well, it’s a great place to start. And, I’ve used that ‘engine room of the economy’ analogy many times over many decades. But what I was trying to surface in that article is that whilst we see what’s happening in the here and now, and it’s great we celebrate that small and family businesses are contributing half a trillion dollars to our economy and you know, two out of five private sector jobs, they are things to herald, their great news stories.
But if you look at the trajectory over time, you actually see that as impressive as those things are, let’s pick the employment share, 42% of all private sector workforce provided by small and family businesses in 2021-22, but it was 53% in 2006-07. Even when you look at the share of Gross Domestic Product. Right now it’s a little under a third, 32.4% and that is spectacularly impressive. But again, go back to 2006-2007, it was 41%.
So, I’m putting forward the idea that something’s going on and that I think quietly we’re heading more towards a big corporate economy than one that really support small and family businesses. Those headwinds are often more compliance obligations, regulatory burdens, things that, you know, if you and I were running a business, and we had 20 people in a compliance department, we’d take our stride.
But for small and family businesses, that compliance stuff, they’ll do that at 10 o’clock at night and they’ll do it themselves and they’ll be the marketing person, they’ll be the chief financial officer. They’ve got a lot on their plates. And the phrase I’ve used in there is let’s stop adding to the wind in their face and let’s really focus on putting wind in the sails of small and family businesses to enable them to be all they can be and to contribute all that they are able to our economy and our communities.
Leon Delaney
All of these very impressive efforts to turn negatives into positives. Bruce, you’re convincing me that you’re a glass half-full kind of guy.
Bruce Billson
Look, Leon, you’ve known me for a long time. I have to remain optimistic. And in fact, even my blood group is positive. So maybe it’s the natural disposition. But it’s also consistent with the outlook of small and family businesses.
They are the strongest, most powerful source of renewable energy, and that’s their perpetual optimism. But we need to do what we can to enable an idea to turn into an investment. To enable a business concept, to actually become a new enterprise and to get the settings right in the ecosystem they operate in so that they’re able to fulfill all of that potential.
And I think if people stopped and thought, wow, what’s happening here, I think what we’re seeing is the environment is more attractive for big corporates with greater resources, greater sophistication, greater ability to navigate ever increasing regulatory and compliance burdens and small businesses finding it more challenging because of those new imposts that they’re having to navigate.
Leon Delaney
Now, in the latter part of your article, you’ve put forward a list of practical suggestions asking the question, what can we do that would be better than what we’re doing right now? You’ve actually put forward a number of different suggestions, and I’m not sure why people haven’t considered these suggestions before. They’re good common-sense suggestions, starting with how we assess the health of the economy and the health of small businesses in particular, and where do we have things like targets for deregulation and reducing red tape, that sort of thing?
Bruce Billson
Well, they’re just practical ways forward. I’m not one to just complain and moan. I’m one to say, hang on, we can probably do better and here’s what better looks like. You know, when governments and regulators are thinking about a new regulatory requirement and let’s face it, we as a nation don’t like seeing things happening that we’re not particularly pleased about. And we want action taken to make sure it doesn’t happen again. Well, that often means new imposts, new regulatory requirements. So, if it’s hardest and most challenging for a small firm to meet ever increasing compliance obligations, surely that’s where you start to work out what’s the most appropriate, right-sized way to have a minimum effective degree of government involvement or new regulatory imposts?
It’s about saying, let’s weigh up what’s going on. Let’s right-size those impositions, let’s evaluate what the impact is. Or even let’s look at what a business naturally does. Is there some way of adapting that to meet some new and emerging requirement that doesn’t impose another new process, another new action step or more time away unremunerated for the business owner to make sure they meet all of those obligations?
Leon Delaney
You also talk about things like regulatory impact statements that obviously are conducted in relation to the development of policy and so forth. But you’ve suggested that those statements should have a dedicated section dealing with the implications for small businesses. Again, it’s one of those things that’s blindingly obvious once it’s put in front of your face, isn’t it?
Bruce Billson
Well, you’d think so, but we recently had an issue regarding the labelling of seafood. Now I love seafood and I’d love it to come from Australia. And when I’m looking for that kind of involvement, I’ll ask. I’ll see what’s labelled. And for those businesses whose sole purpose is to sell us seafood, there are current reporting obligations.
Now, another part of the economy thought, gee it would be good if we could expand that so that if you and I went to the Belconnen Pizzeria and we ordered a pizza with anchovies, amongst all the things the pizza operators got, they’re going to tell you where the anchovies have come from, even though they might represent a microscopic percentage of the value and aren’t actually the real reason you’re buying it. Or some prawns that are in your Thai takeaway that you picked up from Gungahlin.
We’re saying, hang on a minute. This is a challenge for a small business for whom this isn’t their primary source of income and it’s not the majority of the value, and you’re wanting them to keep track of those things when they might not know themselves. Or if you’re not satisfied with their level of awareness about a small percentage of a dish you’re buying, well, maybe shop somewhere else.
But, no. We’ve now got a new regulatory requirement where the people thinking about it said don’t worry, Bruce, they’ve all got electronic menu boards and it will just be an easy change. Walk around these shops Leon. They don’t all have electronic menu boards. They’re not easily changed and they represent another impost for what seems to be a marketing advantage for another section of the economy. When have we decided that is an appropriate motivation for new regulation and how has that been evaluated?
So that’s one example. Before you make a decision, really work it hard to see what the impact is going to be for the smallest respondents who we want to see thrive and prosper, drive innovation and really lift the performance of the economy if they’ve got all this lead in the saddlebag, much of which I don’t think they’ve been front of mind in when it was being formulated.
Leon Delaney
Well, I can assure you that I can relieve my local pizzeria of the responsibility of tracking anchovies. I will never order a pizza with anchovies because they are the work of the devil. They are hideous things.
Bruce Billson
Well, they’re an acquired taste I’m told. But I’m using that one as an example. But even when you think about other challenges. Even the work we’ve been doing trying to ensure that small and family businesses get a bigger share of Commonwealth procurement opportunities. You don’t want that as your ambition but then having behind it a whole bunch of requirements, that actually steer the outcome into the court of large firms because, you know, their best placed to navigate those requirements.
I’m saying it’s time to really put the wind in the sails of small business, energise enterprise, and really have that as a front of mind policy objective and then celebrate the success and let people know that these enterprising men and women are vital to our communities and the quality of life that we enjoy.
And let’s remember Leon, small and family businesses are time poor. They don’t have lobbyists. They don’t have government relations specialists walking the halls of power. They’re counting on all of us who believe and sincerely believe in the importance of their contribution, to have our voices heard. And that’s part of the responsibility of my office as the Ombudsman.
Leon Delaney
Bruce, thanks very much for your time today.
Bruce Billson
Thanks Leon. I’m grateful for your interest.
Leon Delaney
Thank you. Bruce Billson, The Australian Small Business and Family Enterprise Ombudsman.
